Top Federal Reserve officials, including Fed Governor Michelle Bowman, Vice Chair Michael Barr, Fed Chair Jerome Powell, and New York Fed Chief John Williams, have indicated their willingness to support an increase in the federal funds rate if economic data suggests a sluggish approach towards the central bank’s 2% inflation target. Their comments were made at various forums such as a banking conference and the Forecasters Club of New York this week.
Despite considerable progress, these officials agreed that inflation remains elevated, hinting at the possibility of further rate increases. The current policy rate stands between 5.25% and 5.50%. They also underscored the need for a restrictive monetary policy over an extended period to achieve their objectives.
According to these officials, inflation, as measured by the consumer price index, has dropped from around 9% last year to approximately 3.7%. This decline underscores the ongoing efforts by the Federal Reserve to control inflation and stabilize the economy.
During his visit to York, Pennsylvania this week, Fed Chair Jerome Powell shared his outlook on the economy, echoing his colleagues’ sentiments on the necessity for potential rate hikes and a sustained restrictive monetary policy.
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